A postcard from… Germany

As Europe accelerates its energy transition, energy storage is emerging as a critical piece of the puzzle. These interviews explore energy storage business cases across the EU, demonstrating that these projects are viable, profitable and essential to achieving Europe’s energy security and climate goals. These success stories highlight the importance of an EU-wide Action Plan on Energy Storage. to create a supportive framework to allow energy storage to thrive and scale.

This interview with Mr Johannes Ott, Project Manager at ABO Energy KGaA takes us to Wahlheim, Germany.

Hi Johannes, thank you for accepting this interview. Could you give our readers an overview of your energy storage project in Wahlheim, Germany?

This project marks our first endeavor using multiple technologies with remuneration from the German innovation tender. The hybrid plant integrates a photovoltaic (PV) system with battery storage at a single grid injection point, creating significant synergies. It also leverages part of the infrastructure from a nearby wind turbine. The project optimises efficiency by coupling the storage unit with the PV plant at 800V, the output voltage of string PV inverters, thereby reducing costs and minimising BESS charging losses.

Why is this project outstanding?

The project demonstrates our commitment to driving an innovative energy transition. The synergy between solar energy and battery storage optimises efficiency and mitigates grid imbalances caused by solar power injection. In Germany, where commercial curtailment during negative pricing is a major concern, this hybrid solution charges the BESS during low-price solar peaks and redistributes energy during high-demand periods. It can also utilise stored energy to provide secondary or tertiary reserves for frequency stabilisation. This hybrid approach maximises infrastructure utilisation, ensuring economic and operational benefits for investors.

What are the main regulatory challenges you’ve faced in your current market, and how have you addressed them?

Current regulations lack clarity on combining technologies, yet the industry has shown that various renewables can complement each other at a single injection point. Key challenges include:
a) Certified metering between green and brown electricity: allowing batteries to charge from the grid could enhance flexibility. Distinctive metering could maintain the status of green electricity. Regulators have recently made progress in this area.
b) Switching between feed-in tariffs and merchant operation: this transition is underway and represents a positive development.
c) Evaluation of hybrid injection by the grid operator: the lack of standardisation in this process remains a challenge.

Looking at the bright side, instead, what from a regulatory point of view do you think helped the project (if any)?

The innovation tender structure significantly showcased the hybrid case to investors. The rules required bids for market premiums on solar energy co-located with battery storage, providing investment security. Although additional commercial measures were often needed to make projects bankable, this push demonstrated that German regulators are moving in the right direction. We believe other European regulators could adopt similar frameworks to accelerate the development of essential hybrid projects. Additionally, stakeholders such as traders and investors should consider these projects, as they represent a flexibility product that was previously inaccessible.

What measure for energy storage should EU policymakers prioritise – if you could only pick one?

To reduce investment in costly grid expansions, policymakers should prioritise the development and deployment of hybrid systems that combine PV, wind, and batteries at a single feed-in point. Faster grid connection for hybrid projects will enhance investors interest, thus accelerating the energy transition. Additionally, promoting research on advanced battery technologies is crucial, as they could offer longer durations, higher energy densities, longer lifespans, and improved safety compared to current lithium-ion batteries. Strengthening long-duration storage is essential, as it currently does not present a solid business case for investors.

• Find here more information on ABO Energy KGaA
• Find here our Call for an Action Plan
• Find here our previous postcard from Bulgaria